This week, Kelly Ortberg, the new CEO of Boeing, took a hands-on approach in the negotiations with the Machinists. He had a strong message for them: if union members decide to turn down the latest offer on Monday, the next proposal will be less favorable and could have serious implications for their future. Ortberg made it clear that they can’t keep offering more, as Machinists union leader Jon Holden shared in a recent interview. He warned that any future offer would likely take a step back.
While Boeing hasn’t detailed what might be cut from Thursday’s proposal if it’s rejected, Holden mentioned that it could involve losing various benefits—like scrapping plans to build the next airplane in the Puget Sound area, scaling back on a promised 3.8% wage increase, or even reversing a 1% decrease in health care costs. They said anything’s on the table, Holden noted as he described how they’re exploring different options.
The Machinists went on strike back on September 13th, halting production at Boeing’s plants in Renton and Everett while the company’s cash reserves continue to shrink. Union members previously turned down two offers because they believed they could negotiate better pay and retirement benefits from Boeing.
Ortberg’s straightforward message led Holden and his team to realize they might have reached their limit in negotiations. They’ve now advised the union’s 33,000 members to vote yes on this latest offer come Monday, which would end their strike after 54 days. The new proposal is just a slight improvement over what was offered last time: an extra 3% general wage increase that would help achieve that overall 3.8% raise over four years.
Holden mentioned that these pay raises are truly transformative. He pointed out that this is the first time we’ve ever seen such a significant increase. If you look back from 2002 to 2024, the total general wage hikes amount to 31.5%. Our bargaining team thinks it’s crucial to secure this achievement, and Holden emphasized that we really see this as a win for us.
First impressions from the regular members.
On Friday, some workers were paying attention to what Holden had to say. He had just wrapped up a Zoom call with over 500 members before sitting down for an interview with The Seattle Times. During that call, he talked about the new offer and his suggestion to accept it, warning them about the risks of losing previous gains. From the feedback he got during the call, he felt that many were leaning towards accepting the offer. However, there are still some Machinists who aren’t ready to budge. Rob Davis, who’s been with Boeing in Everett for 13 years, is sticking to his no vote and thinks union leaders are just puppets for Boeing. Andrew DeFreese, an equipment operator in Everett, echoed that sentiment on Friday and said he’s also voting no because he wants better paid time off and faster wage progression.
But not everyone feels that way; some workers are really feeling the financial pinch. One worker, who preferred to stay anonymous due to the sensitive nature of this vote, mentioned that although he rejected the previous offer outright, he’s now reconsidering. “I’m leaning more toward just accepting at this point,” he admitted, citing worries about various issues. The financial pressure is becoming tough on his family and he’s concerned about how long he can stay out of work. While he was hoping for a better wage offer from the company, he’s also anxious that if they turn this one down too, they might end up worse off than before: “I think the company can afford to wait us out,” he said.
Carlos Del Villar works as an aircraft testing technician in Renton and noted there’s a split among workers—some want this strike resolved so they can recover from their losses quickly while others want to hold out until pensions come back into play. Having only been at Boeing for two years with an initial hourly wage of $20, Del Villar shared that his savings have dwindled since striking began; he’s even taken a temporary gig with a staffing agency just to make ends meet.
He mentioned that the 3.8% wage increase in the current contract proposal is pretty close to the union’s initial request for 4%, which makes him likely to support it. Holden pointed out that many Machinists, especially those who have been around longer, have been saving up and are ready for a strike. A lot of our members can hold out for quite a while, he said, but some might struggle.
While the union has the option to keep striking, there’s a real risk of the company taking a step back, which could lead to tough times for workers.
Another Machinist, who preferred to stay anonymous due to the delicate nature of the situation, shared on Friday that he doesn’t want to juggle a second job just to get by and is eager to return to work. He also expressed concerns about potential layoffs if the strike drags on. He’s made up his mind to go back next week regardless of how the vote goes.
Boeing takes a tough stance.
Ortberg’s only earlier direct role in the Machinist contract discussions happened back in September. At that time, he personally sweetened the initial offer by promising that Boeing would build its next airplane in the Puget Sound area. He warned that if Monday’s vote ended up being a no, it could set negotiations back, especially after Boeing had previously walked out of mediation led by acting Labor Secretary Julie Su.
When talks resumed on Tuesday in Seattle, Holden mentioned that the union was pushing for improvements on the last offer they had turned down on October 23, while Boeing wanted a revote on that same unchanged offer. “We weren’t going to do that,” Holden stated. At this stage, both sides were separated into different rooms with mediators moving between them. Frustration grew on the management side over the union’s proposals, leading them to leave the building altogether.
Holden reached out to Su for help in salvaging discussions. After she directly appealed to Ortberg, Boeing came back to mediation and eventually proposed an additional 3% wage increase but with a warning attached if it didn’t go through. According to Holden, Boeing was completely unwilling to restore the traditional pension plan they had taken away from Machinists a decade ago.
The mediators and U.S. Labor Department suggested alternative retirement plans offering defined benefits without putting financial burdens on Boeing due to unknown liabilities; however, Holden noted there was no progress made there—“We just didn’t get there,” he said.
This left the union facing a tough decision. In an interview with The Times, Holden disclosed for the first time why he initially recommended Boeing’s first offer of a 2.5% wage hike over four years—which sparked a strike after receiving a 95% rejection vote on September 12—was because it hinged on his endorsement: “They weren’t going to give it unless I recommended it.” On Thursday, this requirement popped up again with their improved offer.
However, this time around Holden felt his reasoning went deeper; he recognized this as a critical turning point in the strike where staying out could risk moving backwards instead of forwards. With those concerns weighing heavily on him, he shook hands with Ortberg and agreed to suggest acceptance of their proposal. “I’m optimistic we’ve done everything we can,” said Holden. “We’ve put an excellent offer before our members; now it’s up to them.”
Monetary distress
Boeing’s recent stock sale has given the company a bit of breathing room. Last week, they managed to pull in $21.1 billion by selling more shares, which should help strengthen their balance sheet and avoid a possible credit rating downgrade. Meanwhile, workers are feeling the pinch as they continue to strike, dipping into their savings.
According to analysts at Jefferies, employees are losing an average of about $10,400 in wages during this time pretty close to the $12,000 ratification bonus on the table and not far off from the $9,900 wage increase some could see in the first year of a new contract.
With this hefty cash boost from the share sale, Jefferies believes Boeing is now better positioned for negotiations. However, their latest proposal still doesn’t reinstate the defined benefit pension plan and doesn’t increase contributions to the 401(k) retirement plan compared to previous offers.
Instead, they combined that earlier $7,000 ratification bonus with a one-time $5,000 contribution to 401(k), giving workers some flexibility on how they want to use that total of $12,000 whether it goes towards their paycheck or retirement savings or split between both.